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					                  Legislative Fiscal Bureau
                  One East Main, Suite 301 • Madison, WI 53703 • (608) 266-3847 • Fax: (608) 267-6873
                  Email: fiscal.bureau@legis.wisconsin.gov • Website: http://legis.wisconsin.gov/lfb




                                                                         October 15, 2013


TO:          Members
             Wisconsin Legislature

FROM:        Bob Lang, Director

SUBJECT: 2013-15 and 2015-17 General Fund Budget


      The following tables (in millions) provide information on the condition of the state's general
fund for 2013-15 and 2015-17 under: the actual 2012-13 closing balance (2013-14 opening
balance); the 2013-15 budget (2013 Act 20); bills enacted, to date, in the current legislative session
(thru 2013 Act 45); and bills scheduled for a Joint Finance Committee executive session on
October 15, 2013. Table 1 displays the projected 2013-15 general fund condition statement.

                                                    TABLE 1
                              2013-15 General Fund Condition Statement

                                                                          2013-14                       2014-15
       Revenues
          Opening Balance, July 1                                            $759                          $505
          Taxes                                                             14,009                        14,514
          Departmental Revenues
           Tribal Gaming Revenues                                              26                             27
           Other                                                              590                            534
            Total Available                                               $15,384                        $15,580

       Appropriations, Transfers, and Reserves
          Gross Appropriations                                            $15,029                        $15,513
          Transfers to:
           Transportation Fund                                                 61                            144
           Veterans Trust Fund                                                  5                              0
          Compensation Reserves                                                79                            133
          Less Lapses                                                        -295                           -335
             Net Appropriations                                           $14,879                        $15,455

       Balances
          Gross Balance                                                       $505                          $125
          Less Required Statutory Balance                                      -65                           -65
            Net Balance, June 30                                              $440                           $60
       Table 2 focuses only on the 2014-15 fiscal year. 2014-15 is the "base year" for construction
of the 2015-17 budget.

                                            TABLE 2

                          2014-15 General Fund Condition Statement


                                                                  2014-15

                      Opening Balance, July 1                         $505
                      Revenues (Taxes and
                       Departmental Revenues)                       15,075
                         Total Available                           $15,580

                      Net Appropriations                           $15,455

                      Gross Balance                                   $125


      Table 3 addresses the structure of the general fund budget. To do so, only the revenues, net
appropriations, and the difference between the two is shown. Thus, Table 3 ignores the opening
balance and focuses only on the revenues and net appropriations for the 12 months of the fiscal
year.

                                            TABLE 3

                        2014-15 Balance of Revenues and Expenditures

                                                                  2014-15

                      2014-15 Revenues                             $15,075
                      Net Appropriations                            15,455

                      Difference                                     -$380


       Table 3 indicates that net appropriations exceed revenues by $380 million. Thus, the
structure of the general fund shows a balance of -$380 million. The -$380 million becomes $125
million when the $505 milion opening balance is considered. However, Table 3 focuses only on
the revenues and net appropriations for the 12-month period (July, 2014, through June, 2015).

       Table 4 shows estimated 2015-17 general fund commitments. This table reflects estimated
increases or decreases of various items for each year of the 2015-17 biennium as a change to base
year (2014-15) revenues and net appropriations.


                                              Page 2
                                            TABLE 4

                             2015-17 General Fund Commitments


                                                                2015-16   2016-17

Revenues (Taxes and Department Revenues)

   2014-15 Base Revenues                                        $15,075   $15,075

   Modifications to Base
     Manufacturing and agriculture credit                          -$41      -$74
     Capital gains for Wisconsin-based assets                         0        -6
     Collections from federal audit reports                           0       -10
     Increase cap for economic development credits                    2         8
     Phase-out medical records credit                                 3         5
     Program revenue lapses                                         -38       -38
         Subtotal-- Modifications                                  -$74     -$115

      Total                                                     $15,001   $14,960

Net Appropriations

   2014-15 Base                                                 $15,455   $15,455

   Modifications to Base
     Transfer to DOT                                              -$108     -$108
     Depletion of TANF balance                                       37        41
     Zoo Interchange bonding debt service                            11        14
     Debt service (excluding Zoo interchange)                       -11       -82
     Parental choice program                                         16        33
     FoodShare work requirements                                      8         8
     Disaster damage aids                                            -9        -9
     Disproportionate share hospital payments                       -15       -15
     Mental health services                                           9         9
     TB response                                                     -2        -2
     Attorney pay progression                                         5         9
     Covenant                                                         0        -4
     Health care data grants                                         -2        -3
     Kenosha County human services                                   -1        -1
     MA fiscal agent                                                  0        -1
     Courts lapse                                                     5         5
     Legislative lapse                                                5         5
     UI interest payment                                             -7        -7
     Technical Excellence Scholarships (2013 AB 398)                  1         2
        Subtotal -- Modifications                                  -$58     -$106

      Total                                                     $15,397   $15,349


                                               Page 3
      Table 5 places the figures from Table 4 into condition statement format for the 2015-17
biennium. No assumptions are made about changes (increases or decreases) in caseload and
population estimates or for such items as state employee compensation in the 2015-17 biennium.
Also, the figures in Table 5 are displayed for the purpose of examining base revenues and
appropriations, adjusted for 2015-17 commitments. The table does not reflect any potential
revenue growth or other appropriation changes.

                                            TABLE 5

                        2015-17 General Fund Condition Statement
                     (Before Revenue Growth and Program Expansion)

                                                           2015-16           2016-17

              Opening Balance, July 1                        $125                $65
              Revenues (from Table 4)                       15,001            14,960
                Total Available                            $15,126           $15,025

              Net Appropriations (from Table 4)            $15,397           $15,349
              Required Balance                                  65                65
               Total                                       $15,462           $15,414

              Amount Needed                                  $336              $389

              Biennial Amount                                         $725


      Table 5 shows that, for 2015-16, the general fund would need to generate $336 million in
order to meet commitments under current law and the provisions of 2013 Act 20, maintain the
required statutory balance, and balance the budget for that year. In 2016-17, $389 million ($53
million over the $336 million in 2015-16) would need to be realized.

     Table 6 lists the estimated general fund amounts necessary to produce a balanced budget for
2015-17 and the nine preceding biennia.




                                                  Page 4
                                             TABLE 6

                General Fund Amounts Necessary for a Balanced Budget*


                                                         1st Year         2nd Year              Total
For the 2015-17 Biennium
 October 15 Memo                                           $336             $389                $725
 2013 Act 20                                                 231              314                 545
 Legislature                                                 239              317                 556
 Joint Finance                                               202              303                 505
 Governor                                                    336              348                 684
For the 2013-15 Biennium                                    -140               -6                -146
For the 2011-13 Biennium                                   1,232            1,279               2,511
For the 2009-11 Biennium                                     800              882               1,682
For the 2007-09 Biennium                                     653              846               1,499
For the 2005-07 Biennium                                     701              845               1,546
For the 2003-05 Biennium                                   1,340            1,527               2,867
For the 2001-03 Biennium                                     693            1,026               1,719
For the 1999-01 Biennium                                     589              914               1,503
For the 1997-99 Biennium                                     624              908               1,532

*Except for 2013-15, all figures indicate amounts necessary to produce a balanced budget. A surplus of
$146 million is shown for 2013-15.




BL/sas




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